Stable matching as transport
Theoretical Economics
2025-03-17 v2 Computer Science and Game Theory
Abstract
This paper links matching markets with aligned preferences to optimal transport theory. We show that stability, efficiency, and fairness emerge as solutions to a parametric family of optimal transport problems. The parameter reflects society's preferences for inequality. This link offers insights into structural properties of matchings and trade-offs between objectives; showing how stability can lead to welfare inequalities, even among similar agents. Our model captures supply-demand imbalances in contexts like spatial markets, school choice, and ride-sharing. We also show that large markets with idiosyncratic preferences can be well approximated by aligned preferences, expanding the applicability of our results.
Cite
@article{arxiv.2402.13378,
title = {Stable matching as transport},
author = {Federico Echenique and Joseph Root and Fedor Sandomirskiy},
journal= {arXiv preprint arXiv:2402.13378},
year = {2025}
}